Grayson Chemical Case Study

Topics: Chemical industry, Management, Culture Pages: 5 (1202 words) Published: June 22, 2013
Case Study:

Grayson Chemical Company
Presented by: Allan Bermudez Marlon Abito Zarny Zaragoza

CASE STUDY: Grayson Chemical Co.
Executive Summary:
Grayson Chemical Co, a 40-year old company manufactures industrial chemicals sold to other industrial companies. It has been run by a stable management in which there had only been two presidents. However, within the past few years, the company is suffering from declining earnings and sales. This has brought pressure from the board of directors, investment bankers, and stockholder groups to name a new president. The company had become stagnant – (although at Grayson, they refer to this as conservative) and had steadily lost market standing and profitability. Finally, the board decided to hire a new CEO and was able to hire a dynamic manager from another major corporation.

CASE STUDY: Grayson Chemical Co.
Tom Baker, 47 and an MBA, has helped his former company into a leadership position. He has chosen to join Grayson after another executive was chosen for the top job in his former company. Baker knows what he needs to do and that is to develop a topnotch management team that could provide leadership to turn the company around. Unfortunately, the situation at Grayson is not very favorable. Decisions are made by the book or taken to the next higher level. Things were done because “they have always been done this way,” and incompetent managers were often promoted to higher level jobs. Baker met with three members of the board. Each of them had a different advice to offer to tom.

CASE STUDY: Grayson Chemical Co.
Robert Temple said: “You can’t just get rid of the old organization if you want to maintain any semblance of morale. Your existing people are all fairly competent technically, but it’s up to you to develop performance goals and motivate them to achieve these standards. Make it clear that achievement will be rewarded and that those who can’t hack it will have to go.” James Allen noted: “You need to bring in a new management team. Probably only six or so, but people who know what top management means, people who are using innovative methods of managing and, above all, people you trust. You cannot retread the old people, and you don’t have time to develop young MBA’s, so you need to bring your own team even though it might upset some old timers.”

CASE STUDY: Grayson Chemical Co.
Hartley Ashford said: “Sure, you’re going to have to bring in a new team from the outside, but rather than bring in people you’ve worked with before, bring in only managers with proven track records. People who have proven their ability to lead, motivate, and perform from different industries. This way you’ll get a synergistic effect from a number of successful organizations. And the old people will see that favoritism is not the way to get ahead. So get a top performance team, and if you lose a few old-timers, so much the better.”

CASE STUDY: Grayson Chemical Co.
I. Time Context: Present II. Viewpoint: Tom Baker, CEO Grayson Chemical Co. and OD consultant III. Central Problem: Grayson Chemical Co. has steadily lost profitability. Symptoms: 1. Company became stagnant. 2. It has steadily lost market share. Causes: 1. Company is very resistant to change. 2. Incompetent managers.

CASE STUDY: Grayson Chemical Co.
IV. Objectives: Must: 1. To develop a new “set of culture” in order for the company to be more adaptive to change. 2. To create a “new system” so that the company will be more competitive and sustain profitability. Wants: 1. To improve operating profit by 50% by end of the year. 2. To strengthen the competency of its people starting with the top management team and key managers.

CASE STUDY: Grayson Chemical Co.
V. Areas of Consideration: I. STRENGTHS
1. Company has been around for sometime. 2. The organization has a stable management. 3. Presence of fairly competent technical people. 4. Young and competent CEO.

II. WEAKNESSES:
1. Organization system is...
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